As the cryptocurrency market continues to grow in size and value, drawing more and more people in, credit card companies are beginning to prevent their customers from purchasing Bitcoin, usually under the pretenses that crypto is too volatile or risky.
A statement from Capital One this week said that they would be banning crypto purchases “due to the limited mainstream acceptance and the elevated risks of fraud, loss, and volatility.”
David Nelms, Discover Card’s CEO, shared these sentiments, saying that “There’s a host of issues, we don’t want to be responsible if someone buys bitcoin and it drops 50% the next day.”
However, this would only be a problem if credit card companies were willingly giving large lines of credit to people who they knew couldn't afford it. While this is obviously unethical and illegal in some cases, it is the primary business model of credit card companies, taking advantage of people who live paycheck to paycheck. While I may not agree with all of the laws and regulations that are involved with loans and credit, it certainly is clear that these companies make most of their money from people who cant afford to pay them back.
In theory, credit card companies shouldn't care what people do with the money they borrow if they are under an obligation to pay them back with interest. Does this move to ban cryptocurrency reveal deeper motives of attempting to keep their customer base poor and in need of loans? Is it a fight against their own obsolescence? Or are they generally afraid that someone might lose money that they cant pay back?
Let me know what you think in the comments!
https://www.wsj.com/articles/should-you-buy-bitcoin-with-your-credit-card-1516897097
(sources for article are hyperlinked at the site above)
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As if the couch you just bought with your credit card didn’t go down 50% in value once it left the showroom floor. The point of credit from credit cards is that it’s your credit to do with as you please, otherwise known as unsecured credit. I have to think that banks and credit card companies that are banning transactions for crypto are genuinely worried about losing their business as people transition to being their own banks and creditors. Resteemed.
Haha at least they admit
"Limited mainstream acceptance ..."
This statement says a whole lot about what is pushed and what is blocked
Coinbase only takes credit cards from Canadian customers. Who's to say I don't have the money to immediately put back on the card and am only using it because it's the only option. There's definitely something else going on behind the scenes. This is also happening while CC companies are canceling bitcoin debit/credit cards....convenient.
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